The sector of direct services to people is expanding, it includes activities related to the assistance of people in their homes. These services concern:
- Family services,
- The services of everyday life,
- Services to people who need special help to perform the tasks of daily life (disabled elderly etc …),
I – Activities concerned
There are currently 26 activities in this branch, you can find them on this website:
All service to people activities may be declared, including those requiring prior authorization or approval to be exercised.
Obtaining a declaration allows organizations and their clients to benefit from the tax and social benefits of personal services.
1 – Modes of intervention
- The service provider mode: in this mode, the customer buys a service from the personal services organization, he will have previously specified his request to the organization that will build a personalized response and present a quote. The organization is the employer of the provider who performs the service at the client’s home.
- The proxy mode: there, the client uses a human services organization, to which he will entrust a number of tasks by mandate contract: search for applications, recruitment and hiring, establishment of pay slips etc … The client is the employer of the worker who intervenes at his home.
2 – Approval
To carry out certain personal service activities with a vulnerable public (children under 3 years of age in service and proxy mode, elderly or disabled people only in proxy mode), the organization must obtain an accreditation issued by the state.
3 – Authorization
The activities carried out with elderly people and people with disabilities or those suffering from chronic pathologies in provider mode are covered by the authorization system issued by the departmental councils.
In return for the tax and social benefits of the sector, the organizations undertake to respect two main obligations:
- The condition of exclusive activity,
- The condition of global offer of services.
II – Check Employment Universal Service (CESU)
There are two kinds of CESU.
1 – The declarative CESU
It is reserved for private employers.
It allows to declare the employed staff at home (or secondary residence) to help in household activities, school support, shopping…
The employee can be remunerated by any means of payment: bank check, transfer or pre-funded CESU. Then we declare the wages paid and the number of hours done on www.cesu.urssaf.fr or on www.pajemploi.fr.
The contributions are calculated and then withdrawn automatically by the URSSAF, which sends the employee an attestation of employment (worth a pay slip).
At the end of the year, the URSSAF sends the employer an attestation allowing the benefit of the tax benefit.
2 – The pre-funded universal service employment check
This is a mean of payment with a defined amount (such as restaurant title) and nominative, financed in whole or in part.
The pre-funded CESU can be:
- Proposed by private or public employers or works councils to their employees,
- Issued by social assistance funders to their beneficiaries.
The advantages of CESU are:
- A simplified declaration,
- No pay slip to be established,
- No calculation of days off with pay,
- A tax advantage.
Precision: the employee or agency payed by pre-funded CESU must be affiliated with the CESU Reimbursement Center (CRCESU) in order to be able to accept this method of payment and obtain the reimbursed the pre-funded CESU.
Consult the CRCESU website and get in touch on 08 92 680 662.
III – Social and tax benefits
1 – Benefits for individuals
The tax benefit consists of an income tax credit equal to 50% of the expenses incurred for the provision of services to the person up to a limit of € 12,000 per year. Increases in the annual spending limit (up to a maximum of € 20,000) may be made depending on the taxpayer’s family situation.
However this cap is decreased for the following activities:
- Small home gardening: ceiling limited to € 5,000,
- Computer and internet assistance: ceiling limited to 3 000 €,
- The little DIY: ceiling limited to 500 € (an intervention cannot exceed 2 hours).
Exemptions from social security contributions for individuals-employers consist of a deduction of € 2 per hour worked on employers’ health insurance contributions, maternity, disability and death.
For people over 70, dependent or disabled, parents of a disabled child, there is an exemption from employers’ social security contributions on the remuneration of home helpers. This exemption is capped at 65 SMIC for persons over 70 years of age.
2 – Tax and social benefits for businesses and organizations
VAT at a reduced rate and VAT exemption:
- For companies:
- Reduced VAT rate of 5.5% for services exclusively related to the essential actions of the daily life of elderly and disabled people and a reduced VAT rate of 10% for services necessary for everyday life for all audiences (French Tax Code-CGI articles 278-0 bis-D and 279-i).
- Standard VAT rate of 20% for five activities (small gardening work, home tutoring, caretaking and housekeeping, home computer assistance, coordination and service delivery activity) as well as organizations operating in proxy mode.
- For associations:
- Exemption from VAT for services rendered to vulnerable persons by associations. They must have an authorization or an approval. (French Tax Code-CGI article 261-7-1 ter).
- Exemption from VAT for services rendered to natural persons by intermediary associations under agreement (French Tax Code-CGI article 261-7-1 bis).
The main exemptions from social contributions for companies and associations:
There is an exemption from employers’ social security contributions on the wages of home helpers employed by an association or a declared enterprise, for the care of disabled children or assistance to the elderly or disabled (Social Security Code-article L.241-10- III).
We did not expose the various trades, with or without diploma and regardless of the level of initial qualification offered by this sector of activity. Nor did we discuss training opportunities.
Of course you can contact us for more information on all these topics.
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